WHEN: TODAY, TUESDAY, OCTOBER 15TH
WHERE: CNBC'S "SQUAWK BOX"
Following are excerpts from the unofficial transcript of a CNBC interview with David Tepper, Appaloosa Management President and Founder, today on CNBC's "Squawk Box." Following are video links from the interview on CNBC.com: http://video.cnbc.com/gallery/?video=3000207879; http://video.cnbc.com/gallery/?video=3000207867; http://video.cnbc.com/gallery/?video=3000207866
All references must be sourced to CNBC.
TEPPER ON WHAT MATTERS
NOW LOOK, YOU DON'T WANT – PEOPLE SAY THEYRE DOING IT FOR CHINA, THEY'RE DOING IT FOR JAPAN. NO! YOU'RE DOING IT FOR MAIN STREET. YOU'RE DOING IT FOR THE AVERAGE GUY. YOU CAN'T HAVE – IF YOU LET US DEFAULT AND INTEREST RATES GO UP ON AVERAGE 50 BASIS POINTS AND TREASURY'S 100 BASIS POINTS – EVERYBODY'S MORTGAGE IS MORE EXPENSIVE. EVERYBODY'S MORTGAGE IS MORE EXPENSIVE AND THAT'S WHAT MATTERS.
TEPPER ON U.S. SINCE REVOLUTIONARY WAR
WHEN YOU START MESSING AROUND WITH THE DEBT OF THE UNITED STATES OF AMERICA, WHICH BY THE WAY HAS NOT MISSED DEBT PAYMENTS WHEN WE WERE WAY OVERLEVERAGED AT THE TIME OF THE REVOLUTIONARY WAR. WHEN HAMILTON MADE THE DECISION TO MAKE THOSE DEBT PAYMENTS, OK? AND YOU DIDN'T MISS A DEBT PAYMENT DURING THE CIVIL WAR. THIS IS THE TIME YOU'RE GOING TO CHOOSE TO MISS A DEBT PAYMENT? THIS IS THE TIME?
TEPPER ON NOT LOSING REPUTATION
WHEN YOU LOSE YOUR REPUTATION, OK? IT'S VERY HARD TO GET YOUR REPUTATION BACK. OK, SO WHEN YOU MISS A TREASURY PAYMENT, IF YOU MISS THE TREASURY PAYMENT, THAT'S NOT A ONE WEEK OR TWO-WEEK DEAL. YOU DON'T GET IT BACK SO FAST. IT'LL TAKE YEARS AND YEARS AND YEARS, OK? AND WE JUST CAN'T AFFORD. WE CAN'T TAKE THE CHANCE. WE CAN'T BE MONKEYING AROUND. WE CAN'T BE PLAYING AROUND.
TEPPER ON FED AND THE AVERAGE GUY
EVERYBODY LIKES TO CRITICIZE THE FED, BUT WE DIDN'T – WE HAD A REALLY, REALLY, REALLY BAD SITUATION BACK IN 2008. AND THIS COULD HAVE ALL TURNED OUT LIKE THE 30s. YOU KNOW WHAT IT DIDN'T DO? IT DIDN'T TURN OUT LIKE THE 30s. AND YES, YOU KNOW, IS IT PERFECT FOR MAIN STREET? NO. BUT ARE THERE SOUP KITCHENS AND LINES GOING AROUND THE BLOCKS THAT YOU SEE IN EVERY CITY? YEAH, THERE ARE SOME BUT NOT LIKE ANYTHING LIKE THE 30s. SO IT'S REALLY DIFFICULT TO SAY THAT THIS PLAN DID NOT BENEFIT THE AVERAGE GUY.
TEPPER ON HUGE DEAL FOR MAIN STREET
IT'S NOT GREAT FOR ME, BUT IT'S HORRIBLE FOR THE MIDDLE CLASS. IT'S HORRIBLE FOR POOR PEOPLE. BECAUSE EVERYBODY'S MORTGAGES IF THEY THINK THEY DEFAULT IS NOT A BIG DEAL. IT IS A BIG DEAL. IT'S A HUGE DEAL FOR EVERY SINGLE AMERICAN. IT'S THE BIGGEST DEAL FOR THE MIDDLE CLASS AND MAIN STREET. THAT IS WHO IT IS A BIG DEAL FOR. AND IF THEY DON'T GET THAT, IF THEY REALLY DON'T GET THAT, WELL, YOU KNOW WHAT, I HOPE THEIR MOTHERS HAD AT LEAST ONE SMART CHILD BECAUSE IT'S NOT ANYBODY THERE.
TEPPER ON STOCK PRICES
IF YOU GET OVER THIS NONSENSE IN D.C., LET'S SAY THEY GET A DEAL IN D.C., OK? LET'S, YOU KNOW, CROSS OUR FINGERS, HOPE THEY GET A DEAL AND THEY DON'T PUT US THROUGH YEARLY STUFF LIKE THIS THAT WE'RE GOING THROUGH RIGHT NOW. SO YOU'RE LOOKING PERSPECTIVELY. SO IF YOU DO GET A – I DO THINK YOU CAN GET A 18 TO 20 TIMES SORT OF MULTIPLE AT SOME POINT. YOU KNOW, AND IF YOU DO GET THAT KIND OF MULTIPLE – LET'S SAY 20 TIMES – AND YOU'RE TRADING PROBABLY AROUND 14 TIMES, LITTLE LIKE THE 14 TIMES NEXT YEAR'S NUMBERS RIGHT NOW. YOU CAN HAVE, YOU KNOW, PRETTY LARGE INCREASE IN STOCK PRICES TO GET TO THERE. TO GET TO THERE NEXT YEAR.
TEPPER ON TAPER
I WAS A LITTLE SURPRISED, BUT NOT THAT SURPRISED. AND I UNDERSTOOD EXACTLY WHEN THEY DIDN'T TAPER WHY THEY DIDN'T TAPER. AND IT WAS BECAUSE THE ECONOMY WASN'T QUITE AT THEIR PROJECTIONS. WELL, IF IT WASN'T QUITE AT THEIR PROJECTIONS BEFORE THIS NONSENSE, IT'S CERTAINLY NOT AT THE PROJECTIONS NOW. AND THE QUESTION FOR THEM IS GOING TO BE WHEN ARE YOU GOING TO HAVE THE MOMENTUM IN THE ECONOMY TO START IT? AND IT CERTAINLY IS NOT NOW. BECAUSE YOU KNOW IT HAS SLOWED SOMEWHAT AND HAS TO BE AFFECTED AND IT IS PROBABLY NOT GOING TO BE FOR THE NEXT THREE TO FOUR MONTHS BECAUSE YOU HAVE THIS OVERHANG AGAIN.
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